US home prices: How low can they go?

Prices continue to plunge, but the US housing market doesn't appear to be turning around just yet, writes Standard & Poor's chief economist.

Even if one isn't reading a newspaper or watching the news, the problems plaguing the US housing market are in plain sight. Just look at all the for-sale signs in the front yards of most neighbourhoods. What's less apparent is how the effects of the ailing market are extending far beyond prospective buyers, would-be sellers, and banks and mortgage companies. Indeed, if not for the decline in residential construction activity, real growth in the US in 2007 would have been...